Take-Two Could Get a Boost From a Trip to ‘Borderlands 3’

By

David Marino-Nachison

Jan. 25, 2019 1:12 p.m. ET

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Borderlands 2
Courtesy Photograph

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Nobody—at least, nobody here—knows when
Take-Two Interactive Software
(TTWO) might release, or even announce, the game known only as “Borderlands 3.” The question, however, is a hot one for gamers and investors alike.

Borderlands, a futuristic shooter composed of parts cartoon and grit, has sold millions across its three-game—technically, two installments plus a prequel—run. When the next game might emerge has become a parlor sport. We even found a fake “teaser trailer” on YouTube meant to troll fans.

For Take-Two, a new Borderlands—which some watchers expect in time for the holidays—could offer needed life heading into 2020. (The photo atop this story is from Borderlands 2.)

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“Looking into the year, we believe: Red Dead Online is likely to emerge from its beta in late 1Q; Borderlands 3 could be announced by the end of March with a September/October planned release; and The Outer Worlds has the potential to be a multimillion unit seller,” wrote MKM Partners’ Eric Handler, who on Friday cut his price target on Take-Two to $130 from $160 while maintaining a Buy rating on the stock.

Shares of Take-Two are down about 11% over the past year, reflecting a challenging period for the industry; it has managed, despite the drop, to outperform Activision Blizzard and Electronic Arts. All three trail the
S&P 500.

Still, the high-level story about the industry—one of a business with growing culture influence, massive revenues, and a continuing shift toward digital distribution and play that should help margins—should encourage investors. But between the lines is a reminder that content drives it all forward—and the right game at the right time can go a long way.

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